2021 (3) TMI 422 - AT - Customs

Liability of the appellant to redemption fine under Section 125 of the Customs Act, 1962 - Confiscation remains unchallenged - penalty u/s 112 (a) ibid - classification of Chick Peas (Tanzania Yellow Gram (Desi Chick Peas)) - HELD THAT - An identical issue came up for consideration before the Tribunal in the case of M/S. O.M.S. SIVAJOTHI MILLS VERSUS THE COMMISSIONER OF CUSTOMS 2019 (8) TMI 1039 - CESTAT CHENNAI where it was held that When the order as to the confiscation remains unchallenged, the importer accepts the order of confiscation and even the exporter offers willingness to accept back (re-export) the consignment, there cannot be any question of redemption fine. Therefore, the redemption fine imposed and upheld by the First Appellate Authority cannot sustain and is accordingly set aside - the redemption fine charged under Section 125 of the Customs Act, 1962 is unsustainable and the same is required to be deleted. Levy of penalty under Section 112 (a) of the Customs Act, 1962 - HELD THAT - A reading of the said Section makes it clear that the penalty under Section 112 (a) would be imposed in the case of improper importation of goods which has rendered the imported goods liable to confiscation under Section 111 and for this, it is held that abatment is not a criterion - the case on hand gets covered under the mischief of Section 112 (a) ibid - however, the penalty imposed under Section 112 (a) of the Customs Act, 1962 is reduced to ₹ 50,000/- Appeal allowed in part.

Summary

Issues:
1. Redemption fine charged under Section 125 of the Customs Act, 1962.
2. Penalty imposed under Section 112 (a) of the Customs Act, 1962.

Redemption Fine Issue:
The appellant imported Chick Peas under the LDC Scheme, which were rejected by FSSAI due to non-conformity with standards. The Lower Adjudicating Authority ordered confiscation, redemption fine, and penalty. The Commissioner reduced the redemption fine, leading to the present appeal. The Tribunal referred to a similar case where it was held that redemption fine is an alternative to confiscation. As the appellant did not challenge confiscation, the redemption fine was deemed unsustainable and deleted under Section 125 of the Customs Act, 1962.

Penalty Issue:
Regarding the penalty under Section 112 (a), the Tribunal analyzed the provision, emphasizing that improper importation rendering goods liable to confiscation attracts penalty. Citing judicial precedents, the Tribunal held that abetment is not necessary for imposing the penalty. Referring to a High Court and Supreme Court decision, the Tribunal upheld the penalty provision. However, considering the appellant's bona fides, the penalty was reduced to ?50,000. The impugned order on the penalty was modified accordingly. The appeal was partly allowed on this issue.

In conclusion, the Tribunal set aside the redemption fine and modified the penalty under Section 112 (a) to ?50,000 due to the appellant's genuine circumstances. The judgment provided a detailed analysis of the legal provisions and relevant precedents to arrive at a fair decision in the case.